The number of authorised people working in the UK’s financial industry has slumped to its lowest level in eight years following a period of large-scale cost cutting across the sector, according to new figures published today.

The size of the sector could fall further as firms continue to downsize, according to headhunters and economists.

The size of the Financial Services Authority Register slumped to 151,835 at the end of last year, according to figures collated and published today by corporate finance boutique, Imas. It is the register’s lowest size since December 2004, when it stood at 140,920.

The register is a list of all individuals who have been authorised by the FSA to carry out regulated activities or provide regulated products or services – and includes bankers, stockbrokers, asset managers and proprietary traders.

More than 16,000 people, or over 10%, have been wiped off the register since February 2008, when the number of authorised people working in the financial industry peaked at 169,887. Later that year, the collapse of Lehman Brothers heralded the beginning of a financial crisis that continues to rack market activity.

Among the most-affected have been FSA-categorised corporate and retail banks, where staff figures fell by 25% from February 2008 to the end of December last year, to its lowest-recorded figure of 22,693. Those designated as stockbrokers fell by 21% to 13,261 over the same period, its lowest figure since September 2004. However, there has been a rise in some sectors, with the number of FSA-authorised hedge fund managers rising by 37.6% to 6,067, its highest on record.

Stephane Rambosson, managing partner of executive advisory search firm Veni Partners, said: “There are ongoing cuts across all sectors, not just investment banking, and I think we will see a continued reduction in overall staffing levels this year. There are too few fees to feed everyone.”

The figures reflect the large-scale cost cutting plans announced by a raft of banks last year, as they face up to the reality of weak activity as well as new legislation such as the Basel capital rules. In October, UBS set out plans to cut 10,000 jobs and do away with large parts of its fixed-income business. Two months later, Citigroup announced a restructuring that is set to result in 11,000 jobs being cut across the group. Other banks, including Nomura, Deutsche Bank and Credit Suisse, also undertook wide-ranging restructurings last year, scaling back investment banking business or exiting entirely.

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Rambosson said: “Firms are adopting one of two strategies: cutting a whole business line, like UBS, and focusing on a particular asset class or geography; or cutting across the board and rationalising the whole business.”

The FSA’s figures mirrors research produced in November by think tank the Centre for Economics and Business Research, in which it predicted the average number of City jobs would fall to 237,000 this year, and to 236,000 in 2014. These figures compare with 354,000 in 2007, and would be the lowest levels since 1993.

Cebr’s higher overall figure reflects its inclusion of non-FSA authorised staff who work in the financial sector, as well as lawyers and accountants who work exclusively on financial sector deals. Rob Harbron, a CEBR economist, said: “The financial sector is one of those that has been most severely hit by weak economic activity and there are weak prospects for growth in the year ahead. Running in parallel to this is a structural shift to the Far East, with emerging market financial centres in China, Singapore and Hong Kong becoming more desirable, through less onerous tax and regulatory regimes.”

Though the number of new jobs created in the City of London dropped 35% to almost 35,115 last year, according to survey published today by headhunter Astbury Marsden, some opportunities do remain. Rambosson said: “Pockets of hiring are taking place, such as upgrading strategies for second and third tier banks looking to recruit better people.”

Raquel Hughes, strategy director at TheCityUK, an independent body promoting the UK financial services industry, said: “It has been a challenging few years for the UK’s financial sector, with a significant amount of job losses at the outset of the financial crisis. However, the employment picture has stabilised since then and we believe there is growing evidence to suggest that cuts to the wholesale sector are being offset by growth in other areas of the industry, such as retail banking, legal services, accounting and management consulting.”